exv10w1






Exhibit 10.1




EMPLOYMENT AGREEMENT




     This Employment Agreement (the “Agreement”) is made and entered into this July 1, 2008, (the
“Effective Date”) by and between T-3 Energy Services, Inc., a Delaware corporation (“Employer”) and
James M. Mitchell (“Employee”).




	1. 	Term.





     The term of Employee’s employment under this Agreement shall commence as of the Effective Date
and shall expire on the second (2nd) anniversary of the Effective Date (the “Term of Employment”).
Notwithstanding the foregoing definition of “Term of Employment”, Employee’s employment may be
sooner terminated as hereinafter provided, and if so terminated, the Term of Employment shall
expire as of the effective date of such termination and all references herein to the “Term of
Employment” shall mean the original term as so shortened, except as otherwise expressly provided
herein.



     In the event that Employee continues to provide services to Employer after the conclusion of
the Term of Employment or any company owned or controlled by Employer (individually the “Company”
and collectively the “Companies”) after the conclusion of the Term of Employment, this Agreement
shall terminate subject to the survival of the provisions set forth in Sections 3 and 9 below,
and Employee shall be an “employee at will” from that time forth subject to the terms and
conditions of employment specified by Employer for all of its employees at will.




	2.	 	Duties and Reporting Relationship.
	 
	(a)	 	Employee agrees to serve Employer as Senior Vice President and Chief Financial Officer of
Employer and in such other executive capacities commensurate with the position of Chief
Financial Officer as may be requested from time to time by the Chief Executive Officer of
Employer (the “CEO”). The CEO may not delegate his or her authority under this clause (a) to
other individuals employed by or working with Employer.
	 
	(b)	 	Employee shall have all of the powers, authority, duties and responsibilities usually
incident to the position and role of Senior Vice President and Chief Financial Officer, and
shall perform such other reasonable duties, consistent with such position. Employee shall
report to, and receive and implement all legal and ethical directions and guidelines from the
CEO [and the Board of Directors].
	 
	(c)	 	During the Term of Employment, Employee shall devote himself to a full time schedule of work
on behalf of Employer and shall use his reasonable best efforts to advance the business and
welfare of Employer. At all times while Employee is employed by Employer, Employee shall abide
by all legal written Employer policies.




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	3.	 	Confidential Information and Covenants Not to Compete.
	 
	3.1	 	Confidential Information.






	 	(i)	 	In consideration of the benefits received by Employee under this Agreement
which he otherwise would not have had but for his entry into this Agreement, Employee
hereby agrees that at all times while Employee is employed by Employer, whether during
the Term of Employment or thereafter, if Employee becomes an employee at will, and
thereafter, he will not, without the written consent of the CEO, disclose to any
person, enterprise, entity or association or otherwise use or exploit for himself or
others any “Confidential Information”.
	 
	 	(ii)	 	The term “Confidential Information” shall mean all proprietary or confidential
information or knowledge of or regarding Employer, whether of a technical,
operational, economic, or other nature, and including any trade secrets (including
customer lists, identities, and contacts and pricing information, know-how, formulas,
patterns, inventions, engineering records or data, interpretive or analytical
information or data, drilling logs, operating agreements and related records, records
of research, proposals, manuals, compilations, programs, devices, methods, processes,
techniques, processes, budgets or other financial information, and any other records or
information that derive independent economic value, actual or potential, from not being
generally known to and not being readily ascertained by proper means by persons other
than the holders, licensees, or other authorized holders thereof who can obtain
economic value from its disclosure or use).
	 
	 	(iii)	 	Notwithstanding the foregoing, Employee may utilize Confidential Information
to the extent required by his performance of assigned duties for Employer or which:






	 	(A)	 	was known to Employee or the public prior to disclosure to
Employee in the course of his employment by Employer,
	 
	 	(B)	 	becomes generally known to the public through no fault of
Employee,
	 
	 	(C)	 	is lawfully obtained by Employee from another source not under
obligation to Employer regarding disclosure of such information, or
	 
	 	(D)	 	is developed after the termination of his employment and
independently by Employee or others without access to or reliance on any
Confidential Information.






	3.2	 	Return of Confidential Information.
	 
	 	 	Upon termination of employment with Employer, whether during the Term
of Employment or thereafter, if Employee becomes an employee at will,
Employee will deliver to Employer all tangible displays and
repositories of Confidential




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Information, including without
limitation, trade secrets and other materials or records or writings
of any other type (including any copies thereof) made, used or
obtained by Employee in connection with his employment by Employer or
its predecessor in interest prior to or subsequent to the execution of
this Agreement. Employer agrees to provide Employee with reasonable
assistance from Employer’s IT personnel in order to facilitate return
of information residing on Employee’s personal computer, PDA or other
device. Employee agrees that all inventions, improvements in any of
the Employer’s methods of conducting their businesses or innovations
(in each case, including, by way of expansion and not limitation,
policies, procedures, products, improvements, software, ideas and
discoveries, whether or not patentable or copyrightable) conceived or
made by him during any time of his employment by Employer prior to or
subsequent to the execution of this Agreement belong to the Employer
and to the extent Employee participated in the creation of any of the
foregoing he did so on a work for hire basis. Upon termination of his
Employment with Employer, Employee shall promptly disclose such
inventions, improvements or innovations to the CEO or his/her
designee, and perform all actions reasonably requested by the CEO or
his/her designee, to establish and confirm such ownership by Employer
and to protect the intellectual property of Employer contained therein
or represented thereby.




	3.3	 	Covenant Not to Compete.
	 
	 	 	Employee hereby agrees that:






	 	(i)	 	Employer agrees to furnish and Employee acknowledges that in his capacity as an
Employee, he will receive and/or have access to valuable and confidential information
as defined in Section 3.1 (ii) as required to perform his duties for Employer. In
consideration for the valuable and confidential information, during the Term of
Employment and until the later of (a) the first (1st) anniversary of the
date of termination of Employee’s employment whether by Employee’s resignation or by
Employer’s termination of the relationship, and (b) such time as Employee is no longer
receiving any payments from Employer pursuant to this Agreement (and as a condition to
Employee receiving any such payments) (collectively, the “Non-Compete Period”),
Employee shall not within Texas, Wyoming, Canada, Mexico or the Parishes of Louisiana
listed in the attached Schedule 1. (i) perform any duties similar in nature to the
duties performed by Employee for the Employer for any competitor of the Business, as
defined below, of Employer, whether as an employee, officer, principal, member,
advisor, agent, partner, director, owner, or consultation of such competitor, and (ii)
compete against any acquisition or development of any line of business, property, or
project on which Employer is then involved or which has been worked on or evaluated by
Employee as part of his services for Employer during the preceding twelve (12) months
and which are still being worked with
or evaluated by Employer. It is the intention of Employer and Employee that insofar
as the Agreement affects the Parishes of Louisiana listed in the attached Schedule
be enforceable under La R.S. 23:921; and the parties agree that within the Parishes
listed on the attached Schedule, the Agreement should be interpreted to fully comply
with La. R.S. 23:921. For purposes




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of this Agreement, “competitor” means any entity
engaged in the business of manufacture, remanufacture, sale and distribution of same
or similar oilfield products and services to customers in the business of drilling
and completion of new oil and gas wells, and the work-over of existing wells.




	 	(ii)	 	With respect to the preceding paragraph, Employee shall not be deemed to be an
owner of a competitor of the Business of Employer where Employee’s ownership interest
is less than one percent (1%) of the outstanding stock or membership units of a company
whose securities are listed on a national or foreign exchange or quoted on the NASDAQ
National Market System.
	 
	 	(iii)	 	During the Term of Employment and during the Non-Compete Period, and as a
condition to Employee receiving any payments from Employer pursuant to this Agreement
to which Employee otherwise would not have been entitled after Employee is no longer
employed by Employer, Employee shall not:






	 	(A)	 	solicit or employ any person for employment by Employee or
Employee’s employer if such person is (i) employed by Employer at that time,
or (ii) who has left the employment of Employer for sixty (60) days or less,
for any employment position or investment opportunity where such position or
opportunity would either interfere with or compete against the Business.
	 
	 	(B)	 	otherwise induce any person to discontinue his or her
employment with Employer, or
	 
	 	(C)	 	request any present or future customer or supplier of Employer
to curtail or cancel its business with Employer, or
	 
	 	(D)	 	unless otherwise required by law, disclose to any person, firm
or corporation any details of organization or business affairs of Employer, any
names of past or present customers of Employer or any other non-public
information concerning Employer.






	 	(iv)	 	Employee understands that the provisions of Sections 3.1, 3.2 and 3.3 may limit
his ability to earn a livelihood in a business similar to the business of Employer, but
as an executive officer of Employer, he nevertheless agrees and hereby acknowledges
that:






	 	(A)	 	such provisions do not impose a greater restraint than is
necessary to protect the goodwill or other business interests of Employer;
	 
	 	(B)	 	such provisions contain reasonable limitations as to time and
scope of activity to be restrained; and
	 
	 	(C)	 	the consideration provided hereunder, including without
limitation of any amounts or benefits contemplated to be provided to




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Employee
hereunder following Employee’s termination of employment other than for Cause
or by Employee’s resignation, is sufficient to compensate Employee for the
restrictions contained in Sections 3.1, 3.2, or 3.3 hereof.




	 	(v)	 	In consideration of the foregoing, and in light of Employee’s education,
skills, and abilities, Employee agrees that he will not assert that, and it should not
be considered that, any provisions of Sections 3.1, 3.2, or 3.3 hereof are otherwise
void, voidable, or unenforceable or should be voided or held unenforceable.
	 
	 	(vi)	 	The unenforceability of any specific covenant shall not affect the provisions
of any other covenant. If it is judicially determined that any provision of this
Section 3.3 or any part thereof is unenforceable under applicable law(s) (statute,
common law, or otherwise), then the unenforceable portion shall be deemed to be
modified to the extent necessary to render it enforceable, while leaving the remaining
portions intact. Employee and Employer further agree that in the event the said
non-competition covenants should be held by any court or other constituted legal
authority to be effective in any particular area or jurisdiction only if said covenant
is modified to limit its duration or scope, then the parties shall thereupon consider
such non-competition covenants to be amended and modified with respect to that
particular area or jurisdiction so as to comply with the order of any such court or
other constituted legal authority, and, as to all other jurisdictions or political
subdivisions thereof, the said non-competition covenant shall remain in full force and
effect as originally written.
	 
	 	 	 	By agreeing to this contractual modification prospectively at this time, the parties
intend to make Section 3.3 enforceable under the law(s) of all applicable states so
that the entire agreement not to compete or to solicit and any other provisions of
this Agreement as prospectively modified shall remain in full force and effect and
shall not be rendered void or illegal. Thus, if for any reason, the Agreement should
be found to be unenforceable in one jurisdiction, the separate and severable
covenants of Section 3.3 covering the other jurisdictions will remain in full force
and effect.






	 	(vii)	 	For the purposes of this Section 3, the business of Employer is described as
follows: Employer engages in the design, manufacture,
remanufacture, sale and distribution of oilfield products and services to customers
in the business of drilling and completion of new oil and gas wells and the
work-over of existing wells through strategically located facilities in North
America and world-wide (the “Business”); provided however that the Business shall
not refer to any products or services from which Employer derives less than 10% of
its revenues. The purpose of the preceding exclusion is to permit Employee to
perform services after termination for an entity which meets the definition of a
competitor but is not engaged in material competition with the Employer.




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	 	(viii)	 	The provisions of this Section 3.3 will not apply if Employee is terminated or
resigns his employment within 180 days after a Change of Control. For the purposes of
this Agreement, a “Change of Control” shall mean the closing of a transaction or series
of transactions in which either (a) more than fifty percent (50%) of the voting power
of Employer or (b) all or substantially all of the assets of Employer are transferred
to a party that was not a significant stockholder, member, or partner in the Employer
prior to such transaction or series of transactions.






	3.4	 	Executive Nature of Employment.
	 
	 	 	Employee acknowledges and agrees that his duties with Employer are of
an executive nature and that he is a member of Employer’s management
group. Employee agrees that the remedy at law for any breach by him of
any of the covenants and agreements set forth in this Section 3 will
be inadequate and that in the event of any such breach, Employer may,
in addition to the other remedies which may be available to it at law,
obtain injunctive relief prohibiting Employee (together with all those
persons associated with him) from the breach of such covenants and
agreements.
	 
	3.5	 	Consideration.
	 
	 	 	Each of the covenants of this Section 3 are given by Employee as part
of the consideration for this Agreement and as an inducement to
Employer to enter into this Agreement and accept the obligations
hereunder.
	 
	3.6	 	Application to Subsidiaries
	 
	 	 	For purposes of this Section 3 and of Section 2 hereof, the term
“Employer” shall include Employer and any and all of Employer’s
subsidiaries or ventures, or any affiliates’ of Employer (as such term
is defined under the Securities Act of 1933), whether currently
existing or hereafter formed; provided however, that in no event will
this Section 3.6 permit re-assignment of Employee to a similar
position at Employer’s subsidiaries or ventures or affiliates in
replacement of Employee’s position at Employer.
	 
	3.7	 	Assignment of Intellectual Property Rights.
	 
	 	 	Employee agrees that all ideas, concepts, processes, discoveries,
devices, machines, tools, materials, designs, improvements,
inventions, computer software and other things of value (hereinafter
collectively referred to as “intangible rights”), whether patentable
or not, which are conceived, made, invented or suggested either by him
alone or in collaboration with others while employed by Employer and
relating to the “Business” (as defined above) and whether or not
during regular working hours, shall be promptly disclosed in writing
to Employer and shall be the sole and exclusive property of Employer.
Employee hereby assigns all of his right, title and interest in and to
all such intangible rights and to any trade secrets developed by
Employee from and after the Hire Date to Employer and its successors
or assigns. Employee further agrees to execute, from time to time upon
the request of Employer, such documentation as may be required by
Employer to confirm Employee’s intent to




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so assign and transfer such
rights and property, including such rights and property which may not
presently exist but which may exist at a later date.




In the event that any of said intangible rights shall be deemed by
Employer to be patentable or otherwise registerable under any Federal,
state or foreign law, Employee further agrees that at the expense of
Employer, he will execute all documents and do all things necessary,
advisable or proper to obtain patents therefor or registration
thereof, and to vest in Employer full title thereto.




	3.8	 	Non-disparagement.
	 
	 	 	During the Term of Employment and thereafter:






(i) Employee will not disparage, condemn or impugn the business or personal reputation or
character of the Employer or any Affiliate, or any present or former employee of the
Employer or an Affiliate or any member of the Board, or any of the actions which are, have
been or may be taken by the Employer or an Affiliate with respect to or based upon matters,
events, facts or circumstances arising or occurring during or following the Term of
Employment; and




(ii) Neither the CEO, nor the Board, or any member of senior management will make any
unfavorable or unflattering statements about Employee and that they will not disparage,
condemn or impugn the business or personal reputation or character of Employee.




	4.	 	Base Salary and Benefits.






	 	4.1.	 	Base Salary.
	 
	 	 	 	During the Term of Employment, Employer shall pay
Employee a base salary at the rate of Two Hundred
Fifty Thousand Dollars ($250,000) per annum payable
in equal installments at least as frequently as
semi-monthly and subject to payroll deductions as
may be necessary or customary in respect of
Employer’s salaried employees in general. Such
salary shall be subject to adjustment under the
Employer’s periodic compensation review procedure
which shall take into account such
factors as job responsibilities, performance and cost of living considerations. In
no event shall such salary be adjusted to less than initial amount set forth above.






	 	4.2.	 	Vacations.
	 
	 	 	 	During the Term of Employment, Employee shall be entitled to vacation
of the greater of four (4) weeks per year or the amount of time
provided under the vacation policy applicable to employees of
Employer generally, as amended from time to time.
	 
	 	4.3	 	Annual Bonus.
	 
	 	 	 	For each fiscal year of the Employer during the Term of Employment,
Employee will be eligible for an annual bonus to be awarded, if at
all,




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	 	 	 	based on the achievement of annual incentive performance targets
established annually by the Board or a committee thereof within
ninety (90) days of the beginning of each fiscal year. To be entitled
to receive a bonus, the Employee must be employed by the Employer at
the time the annual bonus is paid. The annual bonus payable to
Employee for each fiscal year during the Term of Employment shall be
determined as follows: (i) no annual bonus if the performance
threshold is not met; (ii) 60% of Employee’s base salary for
achievement of the performance threshold; (iii) 80% of Employee’s
base salary for achievement of the performance target; and (iv) 100%
of Employee’s base salary for achievement of the maximum target. The
annual bonus payable, if any, to Employee for Employer’s 2008 fiscal
year, shall be pro rated from the Effective Date through the end of
the 2008 fiscal year. The Compensation Committee of the Board will
determine whether the performance goals have been met for a fiscal
year and the amount of any annual bonus for such fiscal year.
	 
	 	4.4	 	Restricted Stock Grant
	 
	 	 	 	Employee shall receive a restricted stock grant of 10,000 shares upon
the date his employment with Employer commences. The grant shall vest
in accordance with the terms and conditions of Employer’s 2002 Stock
Incentive Plan and as defined in the Restricted Stock Award Agreement
and be conditioned upon Employee’s continued employment with Employer
as of each vesting date.
	 
	 	4.5	 	Long Term Incentive Awards.
	 
	 	 	 	Employee shall be eligible for a long-term incentive award in accordance with the
terms and conditions of the Employer’s 2002 Stock Incentive Plan. Employee’s
long-term incentive award shall be based on such incentive performance target(s) as
may be established from time to time by the Board or a committee thereof, in its
sole discretion. The maximum long-term incentive award payable, if any, to Employee
during the Term
of Employment shall be 100% of his target award, if the performance goals for such
award are met in full or exceeded. The long term incentive award payable, if any, to
Employee, shall be paid in any combination of stock options, restricted stock or
other equity-based awards as the Compensation Committee may determine. The value of
stock options, restricted stock or other equity-based awards shall be determined by
the Board or a committee thereof.
	 
	 	4.6	 	Medical Insurance and Other Benefits 
	 
	 	 	 	During the Term of Employment, Employer shall provide Employee with such benefit
programs, including medical, hospital, and life insurance, as is provided, to
employees of Employer generally, as amended from time to time. Employee also shall
be entitled to participate in all other benefit programs which are maintained by
Employer and available to its executive officers generally and under the same terms
as available to Employer’s executive officers generally. Employee acknowledges that
he




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shall have no vested rights under or in respect of his participation in any such
program except as expressly provided under the terms thereof. Employee will be
entitled to participate in Employer’s 401(k) Savings and Retirement Plan, applicable
to employees or executives of Employer generally.




	 	4.7	 	Automobile Allowance
	 
	 	 	 	Employer shall provide Employee with an automobile allowance in the amount of one
thousand dollars ($1,000) per month (which includes appropriate gross-up
calculations).
	 
	 	4.8	 	Dues
	 
	 	 	 	Employer shall reimburse Employee for all dues and assessments paid by Employee to a
country club, not to exceed five hundred dollars ($500) per month, through the Term
of Employment; provided, however, that such country club (a) is located within the
Houston or Galveston, Texas metropolitan area, and (b) does not exclude persons from
its membership or guests of members on the basis of race, gender or religious
belief.






	5.	 	Expenses.
	 
	 	 	In accordance with its policy, as in effect from time to time,
Employer will pay or reimburse Employee for such reasonable travel,
entertainment, use of a cellular phone, or other expenses as he may
reasonably incur during the Term of Employment in the performance of
his duties hereunder, but only to the extent that Employee shall
furnish Employer with such evidence that such
expenses were incurred as Employer may from time to time reasonably require or request in
accordance with its policies.
	 
	6.	 	Death or Total Disability of Employee.
	 
	 	 	If Employee dies or becomes totally disabled during the Term of
Employment, the Term of Employment shall automatically terminate and
Employer’s obligation to compensate Employee under this Agreement
shall in all respects cease, except that Employer shall pay Employee,
within thirty (30) days of such death or termination of employment due
to disability (or sooner if required by law), an amount equal to any
Base Salary earned but unpaid (“Accrued Compensation”) as of the time
of such death or disability and Employee shall be entitled to such
other benefits provided for under Section 4 subject to the terms of
such Employer plans or programs (“Accrued Benefits”). Additionally,
if:






	 	(a)	 	Employee’s employment is terminated by reason of the Employee’s death during
the Term of Employment, Employer shall make a payment to the Employee’s estate or
beneficiary, as applicable, in a lump sum in cash, within thirty (30) days of the
termination date, of an amount equal to the severance amount payable under Section
8(a)(iii).




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	 	(b)	 	Employee’s employment is terminated by reason of the Employee’s disability
during the Term of Employment, Employer shall make a payment to the Employee in a lump
sum in cash, within thirty (30) days of the termination date of an amount equal to the
severance amount payable under Section 8(a)(iii).






For purposes of this Section, Employee shall reasonably be deemed “totally disabled” as of
the time the CEO and the Board shall find, on the basis of medical evidence satisfactory to
the CEO and the Board, that, as a result of a mental or physical condition, Employee is
unable to perform his normal duties of employment hereunder or is prevented from engaging in
the same level of performance as he engaged in prior to the onset of such condition, giving
effect to any reasonable accommodations which can be made by Employer, and that such
disability is likely to continue for a substantial period of time.




	7.	 	Termination for Cause.
	 
	 	 	Employee’s employment may be terminated by Employer for “Cause”, as
described below. Upon such termination, Employer’s obligation to
compensate Employee shall in all respects cease, except that Employer
shall pay Employee, within thirty (30) days of such termination (or
sooner if required by law), any Accrued Compensation as of the time of
such termination and Employee shall be entitled to any Accrued
Benefits as of the time of such termination when and if provided to be
paid by the applicable program or plan. The term “Cause” includes, but
is not limited to, any one or more of the following occurrences:






	 	(a)	 	Employee’s material breach of any of the covenants contained in Section 3.1 and
3.2 of this Agreement;
	 
	 	(b)	 	Employee’s conviction of, or any plea other than not guilty to, a felony or
misdemeanor that involves moral turpitude;
	 
	 	(c)	 	Employee’s commission of an act of fraud with respect to the business and
affairs of Employer, its subsidiaries or affiliates, or their customers, whether prior
or subsequent to the date hereof upon Employer or any of its subsidiaries, ventures or
affiliates;
	 
	 	(d)	 	Employee’s willful failure or refusal to perform his duties as required by this
Agreement; provided that, the termination of Employee’s employment pursuant to this
subparagraph (d) shall not constitute valid termination for Cause unless Employee shall
first have received written notice from the Board stating with specificity the nature
of such failure or refusal in the performance of duties;
	 
	 	(e)	 	Gross negligence, theft of Employer’s, subsidiary’s or affiliate’s property, or
the theft of any property of any customers or suppliers, material violation by Employee
of any duty of loyalty to Employer, or any other material misconduct on the part of
Employee; or
	 
	 	(f)	 	Violation of any written employee policy promulgated by Employer or its
subsidiary or affiliate and applicable to Employee, as in effect at that




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time,
including, without limitation, the receipt of any kick-back or side payment from any
customer, supplier or vendor;




Notwithstanding the foregoing, and except as provided below, termination of Employee’s
employment by Employee for any reason, shall be treated the same as a termination for Cause
and shall be effective as of the effective date of such resignation, but acceptance of such
resignation by Employer shall not be deemed a waiver of any right of Employer under this
Agreement. If Employee (i) through the action of Employer, (a) ceases to hold the title of
Senior Vice President and Chief Financial Officer reporting directly to the CEO, or (b) is
transferred to any place other than within the Houston, Texas metropolitan area (unless such
cessation or transfer is the result of events which would otherwise entitle Employer to
terminate Employee for cause under this Section 7), and (ii) resigns from Employer within
sixty (60) days of such event, then Employee’s resignation under such circumstances shall be
deemed a termination by Employer other than for Cause and have the effect set forth in
Section 9 below.




	8.	 	Other Termination by Employer.






	 	(a)	 	Employer may terminate Employee’s employment at any time for any reason or for
no reason at all, and Employer’s obligation to compensate Employee under this Agreement
shall in all respects cease upon such termination, except that, and provided that
Employee shall not have been terminated for Cause, as described in Section 7 above:






	 	(i)	 	Employer shall pay Employee, within thirty (30) days of such
termination (or sooner if required by law), any Accrued Compensation and any
expenses reimbursable pursuant to Section 5 as of the time of such termination;
	 
	 	(ii)	 	Employee shall be entitled to any Accrued Benefits as of the
time of such termination when and if provided to be paid by the applicable
program or plan. In addition, Employee shall be entitled to reimbursement of
the payment of premiums required to continue Employee’s group health care
coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1986
(“COBRA”) until the earlier of (a) the date his COBRA continuation coverage
ceases or (b) for twelve (12) months after the date of his termination of
employment;
	 
	 	(iii)	 	Subject to Section 9(a), Employer shall pay to Employee (i) a
severance benefit consisting of a single lump sum cash payment equal to two (2)
years of Employee’s base salary as in effect at the time of Employee’s
termination of employment and (ii) a single bonus payment equal to the average
annual bonus paid to Employee for the prior two (2) fiscal years of employment.
If the Employee has not been employed for two full fiscal years prior to his
termination of employment, the bonus payment shall be equal to fifty percent
(50%) of the bonus paid, if any, for the prior fiscal year ending immediately
prior to his termination of employment




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date. The payment to Employee of the
severance benefit shall be conditioned upon the effectiveness of the Release
Agreement which shall be substantially in the form of the attached hereto as
Exhibit “B”;




	 	(iv)	 	The unvested portion of all stock options or restricted stock
of Employer held by Employee shall immediately vest and become exercisable, or
payable, as the case may be, except that any shares of restricted stock, the
vesting of which are subject to the achievement of performance criteria, shall
vest only to the extent such award becomes “earned” based on the achievement of
the applicable performance criteria, with vesting on the date the achievement
of the criteria is determined by the Board, but not later than March
15th following the end of the applicable year; and
	 
	 	(v)	 	Employee’s contingent performance bonus under the Employer’s
annual cash bonus plan for the fiscal year in which Employee’s date of
termination occurs shall be determined at the end of the fiscal year in
accordance with the terms of the bonus plan and performance criteria for such
contingent bonus award, and to the extent such bonus is earned bonus on the
achievement of the performance criteria, the amount (days in the year lapsed as
of Employee’s termination over 365) of such “earned” bonus shall be paid to
Employee in a lump sum on the normal payment date for
such annual bonuses under the plan, but not later than the March
15th following the end of the fiscal year of termination of
employment.






	 	(b)	 	Except as may be required by state or federal law, Employee shall not be
entitled to any other compensation or benefits whatsoever if Employee’s employment is
terminated pursuant to this Section 8.
	 
	 	(c)	 	Notwithstanding the foregoing, it is agreed that Employer’s obligation to make
the payments contemplated in this Section 8(a)(iii) is subject to Employee’s compliance
with the provisions of Section 3 of this Agreement, subject to the requirements to the
contrary of any state or federal law.
	 
	 	(d)	 	Employee shall not have a termination of employment for purposes of this
Agreement unless such termination constitutes a “separation from service” for purposes
of Section 409A of the Code and the applicable Treasury Regulations thereunder;
	 
	 	(e)	 	Notwithstanding anything in this Agreement to the contrary, if at the time of
Employee’s termination of employment with the Employer and its Affiliates, Employee is
a “specified employee” as defined in Section 409A of the Code, and the deferral of the
commencement of any payments or benefits otherwise payable hereunder as a result of
such termination of employment is necessary in order for Employee to avoid the
additional tax under Section 409A of the Code, then the Employer will defer the payment
or the commencement of such payment or benefit hereunder




-12-









 












(without any reduction in such
payment or benefit ultimately paid or provided to Employee) until the date that is six
(6) months following Employee’s termination of employment with the Employer (or the
earliest date as is permitted under the Section 409A of the Code). Any amounts
deferred pursuant to this Section will be paid to Employee (without interest).




	9.	 	Release and Satisfaction.






	 	(a)	 	Form Release Agreement attached hereto as Exhibit “B”.
	 
	 	(b)	 	Any termination of Employee’s employment and any expiration of the Term of
Employment under this Agreement shall not affect the continuing operation and effect of
Section 3 or this Section 9, both of which shall survive and continue in full force and
effect with respect to each of the parties and their respective heirs, executors,
personal representatives, successors or permitted assigns. Nothing in Section 9 shall
be deemed to operate or shall operate as a release, settlement or discharge of any
liability of Employee to Employer or others from any act or omission by Employee
enumerated in Section 7 hereof as a possible basis for termination of Employee’s
employment for Cause.






	10.	 	Miscellaneous.






	 	10.1.	 	Severability.
	 
	 	 	 	If any of the provisions of this Agreement
shall otherwise contravene or be invalid
under the laws of any state or other
jurisdiction where it is applicable but for
such contravention or invalidity, such
contravention or invalidity shall not
invalidate all of the provisions of this
Agreement, but rather this Agreement shall
be reformed and construed, insofar as the
laws of that state or jurisdiction are
concerned, as not containing the provision
or provisions, but only to the extent that
they are contravening or are invalid under
the laws of that state or jurisdiction, and
the rights and obligations created hereby
shall be reformed and construed and
enforced accordingly.
	 
	 	10.2	 	Modification and Waiver of Breach.
	 
	 	 	 	No waiver or modification of this Agreement
shall be binding unless it is in writing
signed by the parties hereto. No waiver of
a breach hereof shall be deemed to
constitute a waiver of a future breach,
whether of a similar or dissimilar nature.
	 
	 	10.3.	 	Assignment
	 
	 	 	 	The rights and obligations of Employer
under this Agreement may, without the
consent of Employee, be assigned by
Employer, in its sole discretion, to any
subsidiary, venture or affiliate of
Employer.
	 
	 	10.4.	 	Notices.




-13-









 












Except as otherwise required by law, any
notice, consent, request, instruction,
approval and other communication provided
for herein (other than routine
correspondence in the ordinary course of
business) shall be in writing and shall be
deemed validly given, made or served:




	 	(a)	 	on the date on which it is delivered personally with receipt
acknowledged,
	 
	 	(b)	 	five (5) business days after it shall have been sent by
registered or certified mail (receipt requested and postage prepaid), or
	 
	 	(c)	 	one (1) business day after it is sent by overnight courier
(charges prepaid; confirmation of receipt documented), or
	 
	 	(d)	 	on the same business day when sent before 5:00 p.m.,
recipient’s time, and on the next business day when sent after 5:00 p.m.,
recipient’s time, by telephone facsimile transmission, provided that the sender
receives electronic confirmation that the document
has been received by the recipient’s facsimile transmission equipment.






Notices to Employer shall be addressed as follows or to Employer’s current address
at the time notice is given:




T-3 Energy Services, Inc.

7135 Ardmore

Houston, Texas 77054

Attention: General Counsel

Phone: 713-996-4136

Fax: 713-996-4123




Notices to Employee shall be addressed as follows:




To the current residential address or fax number of Employee, as indicated
in the Human Resources Department files kept by Employer or its designee.




Either party shall also be entitled to from time to time provide any other address
for notices to be received under this Agreement.




	 	10.5.	 	Counterparts.
	 
	 	 	 	This Agreement may be executed in several counterparts and all such executed
counterparts shall constitute a single agreement, binding on all parties and their
successors and permitted assigns, notwithstanding that not all parties may be
signatories to the original or to the same counterpart. Each counterpart signature
page so executed may be attached to another counterpart of this Agreement and such
counterparts, when so attached, shall constitute a single agreement. Delivery of an
executed counterpart of a signature page of this Agreement




-14-









 












 by telephonic facsimile
transmission shall be as effective as delivery of a manually executed original
counterpart of this 
 Agreement.




	 	10.6.	 	Construction of Agreement.
	 
	 	 	 	This Agreement shall be construed in accordance with, and governed by, the laws of
the State of Texas without regard to any principles of conflicts of law which would
require the application of the laws of another jurisdiction.
	 
	 	10.7.	 	Merger; Complete Agreement.
	 
	 	 	 	This Agreement and any other documents executed contemporaneously
herewith, contain the entire agreement between the parties with
respect
to the transactions contemplated in this Agreement and supersedes all previous oral
and written and all contemporaneous oral negotiations or commitments and other
understandings.
	 
	 	10.8.	 	Non-Transferability of Employee’s Interest.
	 
	 	 	 	None of the rights of Employee to receive any form of compensation payable pursuant
to this Agreement shall be assignable or otherwise transferable except through a
testamentary disposition or by the laws of descent and distribution upon the death
of Employee. Any other attempted assignment, transfer, conveyance, or other
disposition of any interest in the rights of Employee to receive any form of
compensation to be made by Employer pursuant to this Agreement shall be void.
	 
	 	10.9.	 	Legal Fees.
	 
	 	 	 	If any legal action, arbitration or other proceeding is brought for
the enforcement of this Agreement, or because of any alleged
dispute, breach, default or misrepresentation in connection with
this Agreement, the successful or prevailing party shall be entitled
to recover such reasonable attorneys’ fees and other costs it
incurred in that action or proceeding, in addition to any other
relief to which it may be entitled.
	 
	 	10.10.	 	Submission to Jurisdiction.
	 
	 	 	 	Each party irrevocably consents that any legal action or proceeding against it or
any of its property with respect to this agreement or any other agreement executed
in connection herewith must be brought in any State or Federal court in Harris
County, Texas and by the execution and delivery of this Agreement each party
irrevocably submits, with regard to any such action or proceeding for itself and in
respect of its property, generally and unconditionally, to the exclusive
jurisdiction of the aforesaid courts.
	 
	 	10.11.	 	Arbitration.




-15-









 












Any controversy, dispute, or claim arising out of, in connection with, or in
relation to, the interpretation, performance or breach of this Agreement, including,
without limitation, the validity, scope, and enforceability of this section, shall
at the election of Employer or Employee be solely and finally settled by binding
arbitration conducted in Houston, Texas, by and in accordance with the existing
rules for commercial arbitration of the American Arbitration Association (“AAA”), or
any successor organization. Judgment upon any award rendered by the arbitrator shall
be entered by the State or Federal Court having jurisdiction thereof. Any of the
parties may demand arbitration by written notice to the other and to the AAA
(“Demand for Arbitration”). Any Demand for Arbitration pursuant to this section
shall be made within 180 days from the date that the dispute upon which the demand
is based arose. The parties intend that this agreement to arbitrate be valid,
enforceable and irrevocable. This section shall not prevent any party from
commencing an action in any state or federal court of competent jurisdiction in
Houston, Texas for the purposes of (a) enforcing the obligation of a party to submit
to arbitration; (b) enforcing an award granted by an arbitrator in accordance with
this section; and (c) seeking injunctive relief.




	 	10.12.	 	Tax Withholding.
	 
	 	 	 	The Employer shall be entitled to withhold any payments that it makes under this
Agreement or otherwise, all taxes required by applicable law to be withheld
therefrom by the Employer.





[Signature Page Follows]




-16-









 







The parties have executed this Agreement to be effective as of the Effective Date with the intent
to be legally bound by this Agreement.




	 	 	 
	EMPLOYEE

	 	 
	 
	 	 
	/s/ James M. Mitchell
 

Signature

	 	 
	 
	 	 
	James M. Mitchell
 

Print Name

	 	 
	 
	 	 
	EMPLOYER
	 	 
	 
	 	 
	T-3 Energy Services, Inc.
	 	 
	 
	 	 
	/s/ Gus Halas
 

Signature

	 	 
	 
	 	 
	Gus D. Halas
 

Print Name

	 	 
	 
	 	 
	President & CEO
 

Title

	 	 






-17-









 








SCHEDULE 1.

PARISHES IN LOUISIANA WHERE EMPLOYER

CONDUCTS ITS BUSINESS




Acadia Parish

Allen Parish

Ascension Parish

Assumption Parish

Ayoyelles Parish

Bearegard Parish

Bienville Parish

Bossier Parish

Caddo Parish

Calcasieu Parish

Caldwell Parish

Cameron Parish

Catahoula Parish

Claiborne Parish

Concordia Parish

Desoto Parish

East Baton Rouge Parish

East Carroll Parish

East Feliciana Parish

Evangeline Parish

Franklin Parish

Grant Parish

Iberia Parish

Iberville Parish

Jackson Parish

Jefferson Parish

Jeff Davis Parish

Lafayette Parish

Lafourche Parish

Lasalle Parish

Lincoln Parish

Livingston Parish

Madison Parish

Morehouse Parish

Natchitoches Parish

Orleans Parish

Ouachita Parish

Plaquemines Parish

Pointe Coupee Parish

Rapides Parish

Red River Parish

Richland Parish

Sabine Parish

St. Bernard Parish

St. Charles Parish

St. Helen Parish

St. James Parish

St. John the Baptist Parish




 









 





SCHEDULE 1.

PARISHES IN LOUISIANA WHERE EMPLOYER



CONDUCTS ITS BUSINESS




St. Landry Parish

St. Martin Parish

St. Mary Parish

St. Tammany Parish

Tangipahoa Parish

Tensas Parish

Terrebonne Parish

Union Parish

Vermilion Parish

Vernon Parish

Washington Parish

Webster Parish

West Baton Rouge Parish

West Carroll Parish

West Feliciana Parish

Winn Parish




 









 





Exhibit B




RELEASE AGREEMENT




     This Release Agreement (this “Agreement”) constitutes the release referred to in that certain
Employment Agreement dated as of July ___, 2008 (the “Employment Agreement”), by and among James
M. Mitchell (“Employee”) and T-3 Energy Services, Inc.(the “Company”).




     (a) For good and valuable consideration, including the Company’s contemporaneous
provision of certain payments and benefits to Employee in accordance with Section 8 (a)
(iii) of the Employment Agreement, Employee hereby releases, discharges and forever acquits
the Company, its Affiliates (as defined in Section 3.6 of the Employment Agreement) and the
past, present and future stockholders, members, partners, directors, officers, managers,
employees, agents, attorneys, heirs, legal representatives, successors and assigns of the
foregoing, in their personal and representative capacities (collectively, the “Company
Parties”), from liability for, and hereby waives, any and all claims, damages, or causes of
action of any kind related to Employee’s employment with any Company Party, the termination
of such employment, and any other acts or omissions related to any matter on or prior to the
date of this Agreement, including, without limitation, any alleged violation through the
date of this Agreement of: (i) the Age Discrimination in Employment Act of 1967, as
amended; (ii) Title VII of the Civil Rights Act of 1964, as amended; (iii) the Civil Rights
Act of 1991; (iv) Section 1981 through 1988 of Title 42 of the United States Code, as
amended; (v) Employee Retirement Income Security Act of 1974, as amended; (vi) the
Immigration Reform Control Act, as amended; (vii) the Americans with Disabilities Act of
1990, as amended; (viii) the National Labor Relations Act, as amended; (ix) the Fair Labor
Standards Act, as amended; (x) the Occupational Safety and Health Act, as amended; (xi) the
Family and Medical Leave Act of 1993; (xii) any state anti-discrimination law; (xiii) any
state wage and hour law; (xiv) any other local, state or federal law, regulation or
ordinance; (xv) any public policy, contract, tort, or common law claim; (xvi) any allegation
for costs, fees, or other expenses including attorneys’ fees incurred in these matters;
(xvii) any and all rights, benefits or claims Employee may have under any employment
contract, incentive or deferred compensation plan or equity-based plan with Company Party
(collectively, the “Released Claims”). In no event shall the Released Claims include (a)
any claim which arises after the date of this Agreement, or (b) any claim to vested benefits
under an employee benefit plan. This Agreement is not intended to indicate that any such
claims exist or that, if they do exist, they are meritorious. Rather, Employee is simply
agreeing that, in exchange for the consideration recited in the first sentence of this
paragraph, any and all potential claims of this nature that Employee may have against the
Company Parties, regardless of whether they actually exist, are expressly settled,
compromised and waived. By signing this Agreement, Employee is bound by it. Anyone who
succeeds to Employee’s rights and responsibilities, such as heirs or the executor of
Employee’s estate, is also bound by this Agreement. This release also applies to any claims
brought by any person or agency or class action under which Employee may have a right or
benefit.



 









 






     THIS RELEASE INCLUDES MATTERS ATTRIBUTABLE TO THE SOLE OR PARTIAL NEGLIGENCE (WHETHER
GROSS OR SIMPLE) OR OTHER FAULT, INCLUDING STRICT LIABILITY, OF ANY OF THE COMPANY PARTIES.




     (b) Employee agrees not to bring or join any lawsuit against any of the Company Parties
in any court relating to any of the Released Claims. Employee represents that Employee has
not brought or joined any lawsuit or filed any charge or claim against any of the Company
Parties in any court or before any government agency and has made no assignment of any
rights Employee has asserted or may have against any of the Company Parties to any person or
entity, in each case, with respect to any Released Claims.



     By executing and delivering this Agreement, Employee acknowledges that:




     (i) Employee has carefully read this Agreement;




     (ii) Employee has had at least 21 / 45 days (the “Consideration Period”) to consider
this Agreement before the execution and delivery hereof to the Company;




     (iii) Employee has been and hereby is advised in writing that Employee may, at
Employee’s option and expense, discuss this Agreement with an attorney of Employee’s choice
and that Employee has had adequate opportunity to do so;




     (iv) Employee fully understands the final and binding effect of this Agreement; the
only promises made to Employee to sign this Agreement are those stated in the Employment
Agreement and herein; and Employee is signing this Agreement voluntarily and of Employee’s
own free will, and that Employee understands and agrees to each of the terms of this
Agreement.




     (v) Employee must return this Agreement to the Company prior to the end of the
Consideration Period.




     Payment shall be made to Employee pursuant to Section 8 (a) (iii) of the Agreement
within sixty (60) days of his termination of employment, but only if within such 60-day
period, Employee has executed the Release Agreement as set forth in Exhibit B and such
Release Agreement has become irrevocable. In addition, if on his termination of employment
Employee is a “specified employee”, as defined in Section 409A of the Internal Revenue Code
and the Treasury Regulations thereunder, the Employer shall not make or begin to make any
payments to Employee until the first (1st) day that is six (6) months after
Employee’s termination, other than any payment that qualifies as a “short-term deferral”
under Section 409A or qualifies as an exempt separation payment, as provided in Treasury
Regulations Sec. 409A-1(b)(9) – the “two-year, two-time rule”. Any payments that are so
delayed as provided above shall be paid to Employee in a single payment on the first day
that is six months after his termination of employment (or death if earlier).



     Notwithstanding the initial effectiveness of this Agreement, Employee may revoke the delivery
(and therefore the effectiveness) of this Agreement within the seven (7) day period
beginning on the date Employee delivers this Agreement to the Company (such seven day period



 









 




being referred to herein as the “Release Revocation Period”). To be effective, such revocation
must be in writing signed by Employee and must be delivered to the Company before 11:59 p.m.,
Houston, Texas time, on the last day of the Release Revocation Period. If an effective revocation
is delivered in the foregoing manner and time frame, this Agreement shall be of no force or effect
and shall be null and void ab initio. No consideration shall be paid if this Agreement is
revoked by Employee in the foregoing manner.




Executed
on this ___ day of                     , 200___.



	 	 	 	 	 
	 

	 	 

James M. Mitchell